Overview

Pulmatrix is a biopharmaceutical company focused on developing novel inhaled therapeutic products to prevent and treat migraine and respiratory diseases. The company’s proprietary iSPERSE™ technology platform enables the delivery of small or large molecule drugs to the lungs through inhalation. Pulmatrix’s current pipeline includes product candidates targeting central nervous system (CNS) disorders like acute migraine, as well as serious lung diseases such as chronic obstructive pulmonary disease (COPD) and allergic bronchopulmonary aspergillosis (ABPA).

After reviewing strategic alternatives, Pulmatrix entered into a merger agreement in November 2024 to combine with Cullgen Inc. The success of this merger is critical to Pulmatrix’s future operations. If the merger is not completed, the company may pursue dissolution and liquidation.

Pulmatrix’s goal has been to develop breakthrough therapeutic products that are safe, convenient, and more effective than existing treatments in areas where the iSPERSE™ technology provides advantages. The company’s current pipeline includes:

• PUR3100 for the treatment of acute migraine
• PUR1800 for the treatment of acute exacerbations of COPD (AECOPD)
• PUR1900 for the treatment of ABPA in patients with asthma and cystic fibrosis

Pulmatrix is currently exploring opportunities to monetize these clinical assets as part of the merger process. Continued development would require significant additional funding and expenditures.

Therapeutic Candidates

PUR3100 Pulmatrix developed PUR3100, an iSPERSE™ formulation of dihydroergotamine (DHE), for the treatment of acute migraine. PUR3100 has the potential to be the first orally inhaled DHE treatment, providing rapid symptom relief with a favorable tolerability profile compared to other DHE products.

Pulmatrix has completed a Phase 1 clinical study showing that PUR3100 achieved peak exposures in the targeted therapeutic range within 5 minutes of dosing, with a lower incidence of nausea and no vomiting compared to intravenous DHE. Based on these results, the company believes PUR3100 may differentiate from approved DHE products or those in development.

In September 2023, the FDA accepted Pulmatrix’s Investigational New Drug (IND) application for PUR3100 and issued a “study may proceed” letter, allowing the company to initiate a Phase 2 clinical trial once financing or partnership arrangements are secured.

PUR1800 PUR1800 is an iSPERSE™ formulation of a narrow spectrum kinase inhibitor being developed for the treatment of AECOPD. The drug targets key kinases involved in chronic inflammation and airway remodeling.

Pulmatrix has completed a Phase 1b study in patients with stable moderate-to-severe COPD, which showed that PUR1800 was well-tolerated with low systemic exposure. These results, along with data from chronic toxicology studies, support continued development of PUR1800 for AECOPD and potentially other inflammatory respiratory diseases.

PUR1900 PUR1900 is an iSPERSE™ formulation of the antifungal drug itraconazole, being developed for the treatment of ABPA in patients with asthma.

In 2019, Pulmatrix entered into a development and commercialization agreement with Cipla for PUR1900. Under a recent amendment, Cipla will be responsible for all development and commercialization activities outside the United States, while Pulmatrix and Cipla will seek to monetize PUR1900 within the U.S.

Financial Overview

Revenues Pulmatrix has not generated any product sales revenue to date. The company’s revenues in 2024 and 2023 were primarily from the Cipla agreement related to the PUR1900 program, as the company completed wind-down activities for the Phase 2b study.

Research and Development Expenses Research and development expenses consist mainly of costs for preclinical studies, clinical trials, manufacturing, and personnel. These expenses have decreased from $15.5 million in 2023 to $7.2 million in 2024, primarily due to reduced spending on the PUR1900 and PUR3100 programs.

After the MannKind transaction in 2024, which resulted in the termination of most R&D employees and the assignment of the company’s facility lease, Pulmatrix expects to rely more on external resources for further development activities. Continued development of the pipeline would require significant additional funding.

General and Administrative Expenses General and administrative expenses increased from $6.5 million in 2023 to $7.8 million in 2024, mainly due to higher legal and professional fees related to the exploration of strategic alternatives, including the Merger.

Critical Accounting Estimates Pulmatrix’s critical accounting estimates include revenue recognition for the Cipla agreement and accrual of research and development costs. Prior to completing the PUR1900 Phase 2b wind-down, these estimates involved significant judgment and could materially impact reported results.

Results of Operations Revenues increased slightly from $7.3 million in 2023 to $7.8 million in 2024, primarily due to a contract modification with Cipla. R&D expenses decreased from $15.5 million to $7.2 million, while G&A expenses increased from $6.5 million to $7.8 million. Pulmatrix also recorded a $2.6 million loss related to the MannKind transaction.

Liquidity and Capital Resources As of December 31, 2024, Pulmatrix had $9.5 million in cash and cash equivalents. The company anticipates needing additional capital to fund operations, particularly if it resumes development of its pipeline candidates. Pulmatrix’s existing cash is expected to fund operations for at least the next 12 months.

The company has not generated any revenue from product sales and has relied on financing activities, including an at-the-market equity offering program, to fund operations. Pulmatrix’s ability to continue as a going concern is highly dependent on the successful completion of the proposed merger with Cullgen.

Key Strengths and Weaknesses

Strengths:

• Proprietary iSPERSE™ technology platform enabling efficient delivery of drugs to the lungs
• Promising clinical data for lead candidates PUR3100 and PUR1800
• Partnerships and agreements to advance pipeline, including with Cipla for PUR1900

Weaknesses:

• No approved products or revenue from product sales
• Significant reliance on external funding to advance development programs
• Highly dependent on successful completion of the proposed Cullgen merger for future operations

Outlook and Conclusion

Pulmatrix’s future is closely tied to the successful completion of the proposed merger with Cullgen. If the merger is not consummated, the company may be forced to pursue dissolution and liquidation.

Assuming the merger is successful, Pulmatrix will need to secure additional funding to continue development of its pipeline candidates, including PUR3100 for acute migraine and PUR1800 for AECOPD. The company is also exploring opportunities to monetize these assets through partnerships or other strategic transactions.

Overall, Pulmatrix has made progress in advancing its iSPERSE™-enabled therapeutic candidates, but faces significant challenges in financing further development and commercialization. The proposed merger with Cullgen represents a critical juncture for the company, with its future dependent on the successful completion of this transaction and the ability to secure the necessary resources to advance its promising pipeline.